Inflation may have picked up slightly last month as President Donald Trump’s widespread tariffs kicked in, a trend economists expect will become more visible in the coming months. Consumer prices are forecast to have risen 2.4% in April compared with a year earlier, according to data provider FactSet, the same as in March and down from 3% at the start of the year. Still, on a monthly basis, economists expect that the consumer price index rose 0.3% from March to April, a pace that would worsen inflation if it continued, after it fell for the first time in nearly five years the previous month. Tuesday’s report could provide an early read on how Trump’s duties will affect the prices Americans pay for necessities and other goods such as clothing, shoes, furniture and even groceries. Duties on many goods from Mexico and Canada took effect in February and could have impacted prices last month. Still, economists forecast the impact from duties to be modest. “Firms have indicated … that they are unsure how much of the tariff cost increase they can pass through to consumers without denting demand, and we expect some testing of the waters and a staggered pattern of price increases,” Laura Rosner-Warburton, cofounder of Macro Policy Perspectives, wrote in note to clients. The Trump administration said early Monday that it had reached a deal with China to sharply reduce its tariffs on imports from that country. But even taking that agreement into account, U.S. average import taxes remain at 90-year highs, economists said, which could worsen inflation in the coming months. Tariffs on furniture, agricultural goods from Mexico, and on clothes and shoes may have boosted prices last month. Auto prices may have risen because car sales surged as Americans sought to get ahead of duties on new cars and car parts, reducing the need for dealers to offer discounts. Excluding the volatile food and energy categories, core prices are forecast to have risen 2.8% last month compared to a year earlier, the same as in March. On a monthly basis, they are expected to rise 0.3%, up from just 0.1% the previous month. It will likely take more time for the full impact of the duties to be reflected in prices across U.S. businesses, economists say. Items that were already in transit when the tariffs were imposed won’t have to pay the duties, while many companies have built a stockpile of goods and could hold off on price hikes in hopes that tariffs will ultimately be reduced. Consumers, at least those outside the top one-fifth in incomes, are also more stretched financially than a few years ago and are more likely to resist price hikes, which could push firms to delay raising prices as long as possible. Consumer prices cooled noticeably in February and March, prompting Trump to claim repeatedly on social media that there is “NO INFLATION.” Inflation has fallen to nearly the 2% target set by the Federal Reserve, the agency charged with fighting higher prices. Yet grocery prices have jumped in two out of the past three months, despite Trump’s claims. He has also said gas has fallen to $1.98 a gallon, which is below the measured average in any state. AAA said Monday that gas costs an average $3.14 a gallon nationwide. On […]